Richard Svinkin is co-founder and COO at bitcoin remittance service Freemit, and a former UX lead for Kodak and Merck.
In this opinion piece, Svinkin argues that the bitcoin industry's attempts to revamp the technology's user experience have so far been misguided, and that they may have obscured the true value of the technology.
The bitcoin market cap is hovering around $10bn, investment in bitcoin and blockchain startups is staggering and everyone wants in on the game, from newly-minted entrepreneurs to banks.
But there’s a problem. All the focus and energy is going into determining the right way to rebuild the global financial infrastructure. In the rush to take down banking, and be more like bankers in the process, the core mission of the bitcoin project seems to have been left behind.
Many startups have tried selling bitcoin to the masses as an alternative to fiat currency, and they’ve largely failed, pivoting to infrastructure or trying to redefine bitcoin.
Now, we’ll see some of the usual suspects try to sell it to Wall Street as an investment product – an asset class. This is already true in places like China but, as we well know, the entire bitcoin project was envisioned, designed, built and released as a peer-to-peer value exchange system. It wasn’t supposed to be a standalone asset class or a messaging system for banks.
Meanwhile, the original tokens, the bitcoins themselves, are increasing in value again.
But the industry, eyes large with impressing bankers and avoiding regulators wrath, knowingly or not, designed access to bitcoin for specific audiences while trying to stay true to a very specific political vision of how bitcoin must be used and by whom.
Using bitcoin means clunky QR codes, weird wallets and addresses, price volatility and confusion. The recent ethereum DAO "contract hack" will of course throw shade on all crypto as Mt Gox is still fresh in collective memory. But we’ve seen disaster after disaster and somehow the value of bitcoin has survived, thrived, and steadily risen year-over-year since inception.
The adoption question
Ultimately, bitcoin is winning. So, the question remains, are we on the verge of mass consumer adoption but just in a slightly different way than we imagined?
Xapo CEO Wences Casares and many other really smart people have their own distillation of this thing – "bitcoin is the best form of money ever invented". That might be true. But, it also might just be the best store of value ever invented, a true form of "digital gold" as Nathaniel Popper holds.
Think about gold for a second. Gold is portable, hard to counterfeit, impossible to "double spend". It takes effort to mine, and it looks good. Gold has historically been the best store of value ever used and in many ways it still is. But, bitcoin has nearly all these properties and one more. While you can’t wear it, you also can’t just rip it off my neck or wrist and run.
In fact, if someone manages the digital equivalent of a chain snatching the whole network falls apart, destroying the very value that drives the urge to steal it in the first place.
So, why haven’t tens of millions of people with Internet connected devices bought a nugget or a dash of it? Why hasn’t the world at large tried putting $10 into it? People buy other volatile things. They buy the aforementioned precious metals.
They buy gold and silver that’s fashioned into fashionable things and wear it. It’s a status symbol. It has visual meaning. You can touch it. We all agree it has value. It’s value goes up and down based on global markets.
People buy stocks and bonds that don’t have a physical representation. They obsessively check their portfolios all over the world. And they gamble. Billions of people have thrown much, much more into a slot machine or on the floor for a roll of the dice.
Bitcoin is arguably safer than all of these things yet it still hasn’t reached mass adoption. Why? What’s holding it back?
I think user experience is playing a bigger role than we think.
Sixteen years ago, I started my career at an innovative boutique design agency called OVEN Digital, as the director of UX and that was where and when I made my bones in this business.
OVEN, before I joined, made a reputation for building the first web site for MOMA and beat 40 other agencies to get one of the most coveted e-commerce agency jobs to that point – Tiffany & Co. The website cost quite a lot to build. No one believed that you could sell jewelry on a website.
But, as we discovered and our leadership loved to brag – the site paid for itself in 6 weeks. It did so for a variety of reasons, but our graphic designers and rich media teams were amazing, better at UX than I’ll ever be because they knew that when you have great products you crank up the white space, show nice photos and get out of the way.
Funny, in 16 years the UI and aesthetic of Tiffany.com really hasn’t changed that much:
Now take a look at BTC-e, one of the highest volume bitcoin and crypto exchanges in the world.
It looks like the Bloomberg terminal’s younger, less with-it brother. Also a massively successful product, but the UX is all about trading. It’s all about feeling like a Wall Street product, it’s for traders and speculators and wannabes.
Then, if you go inside Coinbase, it’s clean, sure, but again it’s faceless. It feels like I just walked into a bank.
All the safeguards and the delays in deposits, trade execution, withdrawals, etc are akin to the huge stone edifices of old bank branches and bars on the teller windows that say, "I’ve got the power, you should feel so lucky your money is here".
And given the big slip-ups in the early days of bitcoin, that’s a natural reaction, it’s human nature to want my money or my "valuables" in a safety deposit box that curls up like a porcupine. But, we already give money, paper, e-cash, etc, value. We give stocks and bonds value.
We know because we see everyone else use it and we can track our stocks in our IRAs on a website or on CNBC.
People, regular people, haven’t joined the speculative gamble or fun of bitcoin because we in the industry have violated one of the most basic user experience principles – "Don’t make me think."
If a product is good enough it sells itself.
Sure we’re hampered by regulation, but more than that we’re too much in a rush to merge proof-of-stake with proof-of-work and make cross-border trading insurance products work.
We may have created a layer of anxiety that's covering how great the actual product really is.
We’re in too much of a rush to usher in a utopian financial era that we forgot to take a breath, stop, look at what’s there and appreciate what an amazing thing bitcoin is. If we did, we might figure out how to sell it. And if we figure out how to sell it we might be able to bring about the utopian vision we all so secretly want.
I’m not saying we need a physical object or a mascot. I am saying that we can do better.
Wallet to wallet transaction UX is ridiculous for micropayments. All the decimal places make no sense to even smarter-than-average and more-tolerant-than-average people. We can make it much more accessible.
Even with all the KYC/AML and the onboarding nightmare users have with exchanges – when we want something, we fight through stuff like that to get it. Every product has constraints. Every app requires some kind of registration and onboarding.
Venmo sure does, but it took off because it solved a problem that humans have and people have no trouble going through the steps to sign up, link a bank account and wait days to deposit and withdraw money from it. There’s a big UX Problem with the exchanges and the wallets. We can solve it.
We can absolutely do better if we try new approaches on the front end. And these approaches can absolutely stay true to the mission of the community but there will be some trade offs. But it’s worth it if we get millions of new users.
We need a "Jobs" to go with all our Wozniaks. Bitcoin is way too cool and amazing for us to hide it’s full value.
Dirty stove image via Shutterstock